Corbett budget could raise gasoline taxes

HARRISBURG - Gov. Tom Corbett's proposal to lift the cap on a wholesale gasoline tax could cost the typical motorist up to $100 annually by the time it's fully implemented.

This potential pocketbook hit versus the costs of doing nothing to fix deteriorating roads and bridges was debated Wednesday when Transportation Secretary Barry Schoch appeared before the House Transportation Committee. It was the opening salvo in what is expected to be a months-long debate in Harrisburg over a new transportation funding package for roads, bridges and mass transit.

The governor's proposal described as a starting point by many lawmakers hinges on gradually lifting the cap on the state Oil Company Franchise Tax, a levy on wholesalers such as gas stations, over five years. Corbett wants to reduce the state gasoline tax paid at the pump from 12 cents a gallon to 10 cents a gallon over two years.

The changes would yield $500 million in new transportation revenue the first year and $1.8 billion by the fifth year.

Completely uncapping the tax would add about 28.5 cents per gallon to the wholesale price of gasoline by the fifth year of the plan based on information in a report issued in 2011 by the Governor's Transportation Funding Advisory Commission, according to the AAA Federation of Pennsylvania. The assumption is that gas stations or wholesalers would pass on the entire increase to motorists, thus producing the $100 estimate.

Meanwhile, AAA estimates that driving on bad roads costs Pennsylvania drivers an average of $373 a year in extra vehicle repairs and operating costs.

"It's a tough proposal with the price of gas being at record highs this past year," said Jenny Robinson, spokeswoman for AAA Mid-Atlantic. "There are costs to not doing anything. The cost of wasted gas, time and money if we sit in traffic."

Asked if implementing this proposal would leave Pennsylvania with the highest gasoline prices in the nation, Schoch said that Pennsylvania motorist fees are among the lowest and other states are poised to generate new transportation revenue in the next few years.

The secretary stressed that ongoing cost-saving initiatives and pending privatization efforts are key elements of the governor's funding plan.

These include offering carrots and sticks to encourage consolidation of state-aided local public transit agencies. Schoch described a voluntary consolidation of the mass transit agencies in Lackawanna and Luzerne counties as a statewide model with savings of $500,000 a year.

The plan will require consolidation studies for transit agencies. If the study shows savings can be realized and the agencies consolidate, then their local funding match will drop from 20 percent to 15 percent. If they don't consolidate, then their local match will increase from 20 percent to 25 percent.

rswift@timesshamrock.com

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